Home is where the heart is. And your television, laptop, furniture, and other precious possessions. If you rent your residence, what’s the best way to protect your worldly possessions and financial future?

Renters insurance.

69% of New York City residents rent. Less than half of these renters have renters insurance. If you fall into this category, you might wonder, “Do I need renters insurance?”

The simple answer is yes. But if you don’t want to take our word for it, let’s explore the fine points of New York renters insurance.

Why Do You Need Renters Insurance?

Too many renters assume that their landlord’s insurance will cover them in the event of a disaster or accident. While a landlord’s insurance will cover lost structures, it will not cover the possessions of a renter. If the unthinkable happens, the structure may be rebuilt but your things will not be replaced.

A common issue that we hear about on a weekly basis is water damage caused as a result of a shower overflow, toilet back-up, or bathtub leak. While repairs of these items may be the responsibility of the landlord, who is going to defend you if the water damaged tenant below makes a claim against you? Probably one of the most valuable parts of renters insurance is the defense that can be provided to you by your insurance policy.

As a renter in New York City or New Jersey, you probably know that you need some form of renters insurance to keep your home safe from potential disaster and to protect you in the event of a liability claim. What you might not know is exactly what your renters insurance policy covers. And knowing what is covered (and what isn’t) could save you quite a bit of money in the future.

One of our insurance agents can help you with the nuances, and we encourage asking any and all questions you may have, but we also recognize the importance of self-education, so here are the basics.

What Does Renters Insurance Cover?

Whether you’re in New York City or New Jersey, your renters insurance will cover you from a variety of potentially tragic circumstances (almost too many to fit into this blog). That’s why we have decided to break down coverage into three separate categories (which will hopefully make it a little easier to understand) and give you a few scenarios to consider along with limitations to be aware of.

Personal Property

While your landlord’s insurance policy will not cover your belongings in the event of a natural disaster, fire, or theft, your personal renters insurance policy should keep your belongings safe. (One aspect of this coverage that appeals to those on the fence about renters insurance is that it can also be extended to cover your property outside of your home.) However, there are limits.

DisasterYour renters insurance can cover nearly everything you own in the event of a tragic event. Examples of such events include fires, windstorms, explosions, smoke, or even the very common volcanic eruptions in NYC. In all seriousness though, if your items end up being a total loss, your insurance will help you replace those items and get you back on your feet. However, renters insurance does not provide coverage for floods, earthquakes, or hurricanes. For those worried about flooding please discuss getting additional coverage with your agent; we’re pretty good about recognizing the additional need if you live in an area that’s been impacted in the past few years, but it doesn’t hurt to ask.

Theft

This scenario can be viewed from two different angles. If you come home to an open door and stolen possessions, you can submit a claim to have them replaced. Or, if you’re headed to work on the subway and someone snatches your laptop, your renters insurance can be used to cover the replacement (if you have the right coverage). Keep in mind that there are caps on certain items, like collections and jewelry. If you are a jewelry aficionado then you may want to buy a separate policy or rider called a floater. Talk to one of our agents about limitations on certain types of property and how we can get them covered for you

Limitations

It’s one thing to have to replace your belongings because you didn’t have insurance. It’s another when you still have to replace them because you were misinformed about your coverage. One important detail regarding renters insurance to keep in mind is that it will not cover business equipment in your home office. If you work from home or simply have a secondary office in the spare bedroom, you’re better off assuming any work-related items are not protected under your policy, even though there are some exceptions. If this is a concern for you, speak with your insurance agent to see what your best course for coverage is.

Liability

Accidents happen. If you have renters insurance, then your insurance will cover medical payments, as well as any litigation that ensues.

Accident at home

It’s Thanksgiving and you’re hosting. The turkey is moist, the wine is flowing, and everyone’s having a fun time. That is, until your cousin trips over the coffee table and takes a spill, breaking his wrist in the process. Believe it or not, we see many claims come in against clients from family members who were injured in their homes or apartments. Your renters insurance is what can provide defense for you in these situations even though it is unlikely that you will be inviting some of those family members over again.

Accident outside of the home

You’re headed to work, navigating through the congested sidewalk, when it happens. You spill your hot coffee on an innocent bystander. It doesn’t take long to realize that they need medical attention. While you feel terrible, you can at least be assured that renters insurance will cover their medical costs. It can also protect your finances should the other involved party decide to sue for damages.

Limitations

When it comes to liability insurance, be sure you check your coverage amount. Make sure you have the highest coverage you can comfortably afford. Lawsuits and medical bills can quickly exceed your coverage limit, leaving you with a heavy (but avoidable) financial burden.

Loss of Use

Sometimes, disasters may be harsh enough to render your apartment uninhabitable. It helps to know that you won’t have to pay for all of it. Relocation is expensive, but with the right renters insurance, you will be reimbursed for temporary costs as a result of the Loss of Use of your home. Some monetary help during those trying times can help you focus on getting life back to normal a little swifter.

Lodging

Loss of use coverage can reimburse you for money spent on hotels or other lodging if you’re unable to go home. Before you book a room at the nicest hotel in town though, call one of our agents to discuss caps on cost and duration of coverage. While a night at the Sheraton might be out of the question, you won’t have to settle for a motel on the side of the highway. Keep in mind that most policies allow for temporarily housing that is comparable to your current living conditions.

Living expenses

If you find yourself spending more on food while you’re displaced because you don’t have access to a kitchen, you can expect to be reimbursed for a portion of your additional food expenses, if not all of them. Again, there are limitations to this type of coverage so talk to one of our agents before ordering the lobster for breakfast. You may also be reimbursed for additional displacement expenses like laundry, transportation, and pet boarding.

Limitations

There are a few things that must occur before you can claim loss of use. First, your home must be declared uninhabitable. If the type of damage incurred still allows you to safely live in your home, you can’t ask for coverage simply because you would prefer to be away while repairs are underway. Also, the damage to your residence must be caused by something your policy covers. Remember that flooding is not covered by your renters insurance. So, if your apartment floods and you must reside in a hotel for a week, you would not be covered for additional living expenses in that scenario. This doesn’t work because what if you are governmentally mandated to evacuate due to a flood – You still wouldn’t be covered even after damage cause it’s a flood)

So, what does renters insurance cover? Everything from personal property, liability, property damage and loss of use expenses are covered in your NY renters insurance policy. Disaster costs add up quickly. But renters insurance is affordable.